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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: bobby beara who wrote (7217)	2/28/1999 11:41:00 PM
From: BubbaFred	Read Replies (1) \| Respond to of 99985

Superbowl double whammy this year, or THE TRIPLE WHAMMY next year. No escaping that one.

To: bobby beara who wrote (7217)	3/1/1999 1:13:00 AM
From: Challo Jeregy	Read Replies (2) \| Respond to of 99985

OK, all you analyists out there - it's a full moon tonite! Is that buy or sell???? I forgot! <G>

To: bobby beara who wrote (7217)	3/1/1999 8:32:00 AM
From: Les H	Respond to of 99985

Chosen few drive the surge on Wall Street London Times ANALYSTS are increasingly worried by the narrowing focus of the American stock market. Fewer and fewer shares are accounting for more and more of the stock market's gains. Similar trends in the past have been seen before big corrections. A study by Jeffrey Warantz and John Manley, equity strategists at Salomon Smith Barney in New York, shows that the stock-market boom is much more narrowly based than most people think. Last year the Nasdaq composite rose 39.6%, the Dow Jones industrial average rose 16.1% and the Standard & Poor's 500 rose 26.7%, but the shares of most companies lost value. Warantz says: "Fund managers were asking, 'How come I can't beat the indexes?' The answer is that three-quarters of the stocks in the S&P 500 have lost value over the past year." Big blue-chip companies have appreciated most, despite the spectacular gains made by a few small Internet start-ups. While companies worth more than $20 billion climbed 25.9% last year, those worth $250m or less fell more than 24%. So far this year the 112 companies with a market capitalisation of more than $20 billion have risen 4.29% while those worth between $250m and $2 billion have fallen 8%. This has been bad news for investors who put their money into small-cap stocks and funds, believing that in a mature bull market the greatest room for growth lay in smaller and generally more innovative companies. The Russell 2000, an index that tracks small stocks, has fallen 13.8% in the past year and 6.3% since the beginning of this year. Just 10 stocks accounted for 43% of the S&P 500's growth last year. The percentage has risen even higher as investors have become increasingly worried about lofty valuations and moved their money into supposedly safer big stocks. By mid-February the 10 stocks accounted for 54% of the S&P's gain in the past year. In the Nasdaq market the divergence between winners and losers is even more striking. Three companies, Microsoft, Intel and Cisco, account for 28.8% of the total capital of the market's 5,756 companies and for an even bigger percentage of the gains. Warantz says: "The trend is getting more pronounced. We use a 'laggard indicator' to track stocks that have lagged the market by 15% or more. There have been only three previous occasions since 1970 when 50% or more of American stocks lagged that much, and each of those occasions preceded a big correction." The 50% threshold was passed in March 1973, July 1987 and May 1990. The laggard indicator now stands at 74.3%, a record, and implies a correction is overdue. But there is no predicting when the collapse (if it comes) will happen. Warantz's indicator has been above 50% since early 1997, and despite a few scares - such as the big dip last August - no serious or lasting correction has occurred yet.